Let Gordon Murray Help You Do The Math On Affordable Sports Cars You Won't Buy Anyway
https://www.youtube.com/watch?v=DGw2NDgERgI
Just a quarter-billion dollars! The automotive world is abuzz with news of the Gordon Murray T.50, and rightfully so --- this is a racer's idea of a supercar/hypercar/whatevercar, and certain to thrill the microscopic Euler overlap of "can afford it" and "can drive it" in a way no other street-legal automobile can match. (The Radical RXC can no doubt match whatever numbers the T.50 will post, particularly when turbocharged, but it won't have the GMA car's luggage or passenger space.) Yet when I read the press release, all I could think of was,
"It's only going to cost a quarter-billion dollars to design, engineer, and build all 106 of them!" Just to put this in perspective, it cost $1.2B just to develop the first-generation Chevy Volt, which wasn't a clean-sheet vehicle aside from the powertrain, and $6B (that's the number six) to create the Ford Contour and its Zetec four-cylinder engine. It cost more money to create the C5 Corvette than it's taken to create the T.50, and GM already had the engine paid for out of another account.
Keep in mind there are significant costs involved with the building of each T.50 --- maybe $100k for the engine/transmission combo, that much again or more for the rest of the car --- so in reality this was probably a $200M project or less. There were no corners cut in the design of the T.50, except for the most important corner of all, to which we'll return shortly. Regardless, we now have possession of a remarkably interesting data point, courtesy of Gordon Murray: what it costs to design a proper sports car.
Look at this another way: Mazda has sold something like 50,000 ND-generation Miatas. If they could develop the next one for $200M, and it sold in similar fashion, that would mean development costs would be about four grand per chassis. I can't find anything to suggest that Ford sold more than three million of the original Contour/Mondeo, placing the individual development cost for that kinda-interesting but relatively prosaic vehicle at two grand per. That kind of math makes it much easier to justify making something besides another midsized crossover. Just get Gordon Murray's team to design it at bargain-basement cost.
If GMA could create a $100,000 car with the same general approach used in the design of the T.50, and they could sell 10,000 of them, the per-unit development cost would drop from $2M per car to $20,000 per car. Such a car would need to contain $50,000 in parts rather than the couple hundred thousand of a T.50, but that's not as disastrous as it sounds because vehicle engineering is one of those situations where you pay an exponential increase to achieve an incremental benefit.
The full-price T50 makes 650 horsepower and weighs about 2,160 pounds. With the same amount of development effort, but less budget per unit, what would those numbers look like? One place we could save money without gaining much weight: a fully dressed LS6 V8 weighs about 80 pounds more than the Cosworth V12 in the T.50, while a Tremec manual transmission weighs slightly less than the Xtrac unit used in that car. No, you wouldn't have the rapturous experience of spinning a naturally-aspirated V-12 to 12,000 RPM, but hey, it sucks to be poor, right?
The T.50 uses a carbon monocoque, but here's the thing about carbon-fiber stuff: all the money is in jig setup and labor, not in raw materials. The BMW i8 used a carbon monocoque, too. Based on what I know about bikes, I suspect that the cost of building 10,000 carbon monocoque bodies is actually not that far away from the cost of building 106 carbon monocoque bodies. The same would be true for many other carbon/resin parts in the car. It's also shockingly true of things like headlights. It takes a lot of money to develop bespoke headlights and tail lights, which is why all the RVs you see rolling down the road have F-150 lamps, why the Diablo 6.0 had Nissan headlights, and why the Noble M400 had tail lights from the Hyundai Sonata. Maybe you just buy Miata parts for this car and save all of those costs.
Eventually, however, our purist $100k supercar project runs into the first problem, which is materials cost. It's a common shortcut in the high-end car business to use exotic or expensive materials in place of design and engineering time. Don't want to spend ten million dollars testing a driveshaft to make sure it won't blow up 2005-Mustang-style? Just make it a CNC-milled piece of solid titanium! As I go through my Radical PR6 with an eye to replacing or fixing parts, I see that again and again. The car is chock-full of stuff that was machined rather than cast or forged, because it was cheaper on a total cost basis to do it that way. Even if the individual part costs ten times what it would as a factory-produced item.
You can't make a $100,000 road-legal car of any kind entirely out of CNC-machined parts, and this costs additional development money to address. Lotus has had some success here with its most recent Evora and Exige ranges by outsourcing a lot of small parts to major manufacturers like Continental and Brembo. A major manufacturer could also use some parts from its entry-level cars, many of which are weight-engineered to a surprising degree for reasons of fuel economy and production cost.
It seems likely that GMA could build a mass-market T.50 with a General Motors drivetrain and various nasty-plastic bits for, oh, let's say $100,000. This car would weigh more than a T.50, but maybe not that much more. 2,750 pounds. Less power, but not that much less. 550 horsepower. It could look basically the same: good styling costs the same as bad styling. There would be no downforce fan and no super-trick instrument panel surround and no individually-machined pedals --- although it would be smart to pay the $100 or so extra it costs to have those, because potential buyers would notice and be favorably impressed.
"If this is so easy, why didn't GM do it with the Corvette?" Well, they kinda did --- and that's where the second problem for our $100k supercar project appears. There probably aren't 106 people out there who can both afford the T.50 and drive it properly, but the guaranteed investment potential of the vehicle means there will be no trouble selling the whole production run. A 10,000-unit budget-model T.50 is a different thing. Most people would rather have a paddle-shift Corvette with killer A/C and a nice stereo. Dodge proved that with the Viper, which was a scalding bargain at $84,995 but didn't sell well enough to keep the plant running. There would not be 10,000 buyers for a cheaper take on the T.50. You'd need an automatic transmission, and a waterproof cabin, and a 50,000-mile warranty. That's a C8 Corvette, which already exists. The C8 is a great car, and also great to drive. It just doesn't stir the senses the way a cheaper take on the T.50 would.
The second tier of the automotive press has devoted some time to "hot takes" about why all the people who buy the T.50 will be bad people. Nobody should have enough money to buy a $2.6M car! You're an exploiter! You didn't build that! Yet for all of their undoubted moral failures, it can be said in the defense of T.50 buyers that they are actually going to buy the vehicle in question. If middle-class buyers were so much better than their moneyed counterparts, they would line up to buy something like the cheaper T.50 described above. They won't --- we won't, I should say, I'm a committed member of America's lower-to-middle middle class myself --- because we'd rather have a Corvette. Or an SUV. Or a pickup truck.
Which leads us to a simple realization: It's probably not that hard to engineer a purist supercar for $200 million. On the other hand, it's essentially impossible to find 10,000 buyers for that car, regardless of price. It's a demand-side problem, not a supply-side one. If you want to fight that, do what my wife did: buy a brand-new stick-shift sports car of your own, even if it's not EXACTLY THE RIGHT COMBINATION OF COLOR AND EQUIPMENT THAT YOU WOULD TOTALLY BUY IN TEN YEARS WHEN IT'S A USED CAR SELLING FOR TEN GRAND. Go buy a car. Vote with your dollars. If enough people did that, the enthusiasts in the product-planning departments would be able to sell their bean-counter bosses on a whole new generation of affordable sports cars. If not? If nobody buys today's enthusiast cars, preferring to gripe about their minor flaws and babble on the Internet about various imaginary purchases of the distant future? Well then...
